MEDICARE I: Program Celebrates 35th Birthday Today
As Medicare celebrates its 35th birthday today, HHS Secretary Donna Shalala spoke with NPR "Morning Edition" host Bob Edwards about the program's history and future. The primary reason for the program's inception in 1965 was to cover the cost of hospital care, Shalala said. But, as health care has changed over the years and more people receive care outside of hospitals, Medicare, too, has changed what kinds of services it covers, including offering more preventive benefits, such as flu shots. In addition, because people are living longer, Medicare encounters more chronic diseases, which account for a "very high percentage of Medicare's expenses," Shalala said. Even as Medicare celebrates its successes and transformations, Edwards pointed out that the program faces several challenges, including some seniors' loss of Medicare HMO coverage. About 700,000 seniors will lose coverage under their HMOs this year, as several managed care companies exit the market. Shalala responded: "Some people are getting dumped by their HMOs, but they're not losing their Medicare, and that's the important message -- that ... they may be losing a choice of a particular HMO, but they'll be able to stay in regular Medicare and get the physician services that they need." In addition, care providers have voiced concerns about reimbursement cuts as a result of the 1997 Balanced Budget Act. Shalala said that the federal government plans to address those concerns, but added that some of the problems providers face are "not necessarily related to Medicare." She said: "Medicare did overpay [providers] for a very long period of time. They got used to those overpayments. In most cases, though, Medicare is [now] paying exactly [the] amount it should be paying for its patients. It's not overpaying. And ... many private employers are underpaying now. And there's no place to shift the costs to." Shalala added that the government would look at situations where it "created [providers'] problems with ... budget cuts" and then make necessary corrections. But she said that the "federal government shouldn't make up the difference between what private employers pay for their recipients and what we're paying for Medicare recipients. We should pay accurately for those for whom the government has taken responsibility." As for expanding Medicare in the future, Shalala is open to adding a prescription drug benefit. She said: "It's important that Medicare not become a second class program, that it continue to be a quality program. That requires prescription drugs being covered. No one would have designed a program 35 years ago without prescription drugs if they knew what we know now -- that prescription drugs are a critical part of health care" (7/12).
Shalala said that a group of centenarians -- who were about age 65 when the program began -- will join government and health officials to celebrate Medicare's 35 years of service today. One senior will speak about the program. Check out Medicare's Web site, http://www.medicare.gov, for additional birthday festivities. Visit http://www.ibtv.net/medicare to view a live broadcast of activities from Washington, D.C., today, between 1 p.m. and 2 p.m. EST, and Atlanta from 10 a.m. through 3 p.m. EST.